Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.
Trade-Ideas LLC identified
) as a "barbarian at the gate" (strong stocks crossing above resistance with today's range greater than 200%) candidate. In addition to specific proprietary factors, Trade-Ideas identified Time Warner Cable as such a stock due to the following factors:
- TWC has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $175.9 million.
- TWC has traded 1.3 million shares today.
- TWC traded in a range 206.4% of the normal price range with a price range of $3.38.
- TWC traded above its daily resistance level (quality: 1 day, meaning that the stock is crossing a resistance level set by the last 1 calendar day. The resistance price is defined by the Price - $0.01 at the time of the signal).
Stocks matching the 'Barbarian at the Gate' criteria are worthwhile stocks to watch for a variety of factors including historical back testing and volatility. Trade-Ideas targets these opportunities because the stock is exhibiting an unusual behavior while displaying positive price action. In this case, the stock crossed an important inflection point; namely, 'resistance' while at the same time the range of the stock s movement in price is more than twice its normal size. This large range foreshadows a possible continuation as the stock moves higher.
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More details on TWC:
Time Warner Cable Inc., together with its subsidiaries, offers video, high-speed data, and voice services to residential and business service customers over its broadband cable systems in the United States. The stock currently has a dividend yield of 2.3%. TWC has a PE ratio of 15.5. Currently there are 13 analysts that rate Time Warner Cable a buy, no analysts rate it a sell, and 11 rate it a hold.
The average volume for Time Warner Cable has been 2.1 million shares per day over the past 30 days. Time Warner Cable has a market cap of $32.2 billion and is part of the services sector and media industry. The stock has a beta of 0.75 and a short float of 1.5% with 3.21 days to cover. Shares are up 15.8% year to date as of the close of trading on Tuesday.
rates Time Warner Cable as a
. The company's strengths can be seen in multiple areas, such as its revenue growth, notable return on equity, reasonable valuation levels, solid stock price performance and increase in net income. We feel these strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated.
Highlights from the ratings report include:
- TWC's revenue growth has slightly outpaced the industry average of 0.5%. Since the same quarter one year prior, revenues slightly increased by 2.7%. Growth in the company's revenue appears to have helped boost the earnings per share.
- The stock has risen over the past year as investors have generally rewarded the company for its earnings growth and other positive factors like the ones we have cited in this report. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
- Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. Compared to other companies in the Media industry and the overall market, TIME WARNER CABLE INC's return on equity significantly exceeds that of both the industry average and the S&P 500.
- The net income growth from the same quarter one year ago has exceeded that of the Media industry average, but is less than that of the S&P 500. The net income increased by 6.4% when compared to the same quarter one year prior, going from $452.00 million to $481.00 million.
- You can view the full Time Warner Cable Ratings Report.